$1,808,245 in Back Wages and Penalties for Violations of Wage and Record-Keeping Laws

Monday, April 21, 2014

The U.S. Department of Labor has obtained a series of consent judgments in the U.S. District Court for the Eastern District of New York ordering seven Long Island restaurants to pay a total of $1,693,507.22 to 363 low-wage workers, chiefly servers and kitchen employees. The restaurants will also pay $114,737.96 in civil money penalties and interest to the department for willful violations of the Fair Labor Standards Act.

Investigations by the Long Island District Office of the department’s Wage and Hour Division found widespread violations by the restaurants of the FLSA’s minimum wage, overtime and record-keeping requirements. Specifically, the employers engaged in unlawful activities, such as paying below the federal minimum wage; paying cash off-the-books; not paying overtime; illegal tip pools; failing to pay wages to certain employees; and not keeping records of hours worked and wages paid to employees.

The investigations were conducted under the Wage and Hour Division’s multiyear enforcement initiative, focused on strengthening labor compliance in Long Island’s restaurant industry. In addition to identifying wage violations and recovering money for underpaid workers, the initiative’s goal is to change industry behavior permanently to ensure proper compensation for all workers and a level playing field for all employers. In fiscal year 2013, initiative cases conducted by the division’s Long Island office resulted in $6.4 million in back wages for more than 1,300 workers and reflected 71 consent judgments.

The FLSA requires that covered employees be paid at least the federal minimum wage of $7.25 per hour, as well as time and one-half their regular rates for every hour they work beyond 40 per week. The law also requires employers to maintain accurate records of employees’ wages, hours and other conditions of employment, and prohibits employers from retaliating against employees who exercise their rights under the law. The FLSA provides that employers that violate the law are, as a general rule, liable to employees for back wages and liquidated damages payable to the workers.